Why does setting overflow alter layout of child elements?

Question

In this question someone was having a layout problem because they had two floated divs inside a non-floated div. I suggested adding float: left to their outer div, which does fix the problem. Someone else suggested adding overflow: hidden, which to my surprise, also worked.

This doesn't seem at all like the purpose of of overflow: hidden. Clearly overflow: hidden causes elements to view their children differently somehow. What I'm really trying to understand is what that difference is. Intuitively it should only make the element smaller than it would otherwise be, never bigger and I don't see why it would affect the layout hierarchy.

Can anyone explain why this would be correct/necessary behavior or if this is just a browser quirk? Is their another facet to the overflow property I'm missing? Is either solution any better than the other?

Edit: I've discovered setting overflow: auto works too, so it doesn't seem to be the value of overflow that's important, just that it's set. I still don't understand why.

Answer 1

Overflow of anything but visible creates a new block formatting context which causes floats to be contained. It's standard behaviour.

Floats, absolutely positioned elements, inline-blocks, table-cells, table-captions, and elements with 'overflow' other than 'visible' (except when that value has been propagated to the viewport) establish new block formatting contexts.

In a block formatting context, boxes are laid out one after the other, vertically, beginning at the top of a containing block. The vertical distance between two sibling boxes is determined by the 'margin' properties. Vertical margins between adjacent block boxes in a block formatting context collapse.

In a block formatting context, each box's left outer edge touches the left edge of the containing block (for right-to-left formatting, right edges touch). This is true even in the presence of floats (although a box's line boxes may shrink due to the floats), unless the box establishes a new block formatting context (in which case the box itself may become narrower due to the floats).